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Trading Diary
September 29, 2003

These extracts from my daily trading diary are for educational purposes and should not be interpreted as investment advice. Full terms and conditions can be found at Terms of Use .




USA
The Dow Industrial Average formed a weak pivot point reversal on low volume, closing up 0.7% at 9380 on an outside day.
The intermediate trend is weak, with continued low volume.
The primary trend is up. The trendline has been broken, signaling weakness. A fall below 9000 will signal reversal.



The Nasdaq Composite recovered 33 points to 1835 on lower volume.
The intermediate trend is down.
The primary trend is up. Price appears headed for a re-test of the supporting trendline. A fall below 1640 will signal reversal.


 


The S&P 500 recovered 10 points, to above the 1000 support level, at 1007, on lower volume.
The intermediate trend is weak.
The primary trend is up. The trendline has been broken, signaling weakness. A fall below 960 will signal reversal.



The Chartcraft NYSE Bullish % Indicator eased to 78.55% (September 29).

Market Strategy
Short-term: Bullish if the S&P500 is above 1008. Bearish below 995.
Intermediate: Bullish above 1008.
Long-term: Bullish above 1008.


Consumer spending rises
Fuelled by mortgage refinancing, August consumer spending rose by 0.8%, while personal incomes increased by 0.2%. (more)

Treasury yields
The yield on 10-year treasury notes formed an inside day with a close at 4.08%, after testing support at 4.00%.
The intermediate trend is down. 
The primary trend is up. A close below 4.00% will signal weakness.





Gold
New York (16:53): Spot gold tested 379 before recovering to 381.80.
The primary trend is up.
The target for the symmetrical triangle is calculated as 426 (365 + 382 - 321), but expect heavy resistance between 400 and 415 (the 10-year high).




ASX Australia
The All Ordinaries closed down 6 points at 3170. Low volume and volatility signal that a reversal is likely.



The intermediate trend is down.
The primary trend is up. A fall below 3000 will signal reversal.  

MACD (26,12,9) is below its signal line; Slow Stochastic (20,3,3) is below; 
Twiggs Money Flow (100) displays two bearish peaks below the signal line.

Market Strategy
Short-term: Bullish if the All Ords is above 3180. Bearish below 3162.
Intermediate: Bullish above 3180.
Long-term: Bullish above 3180.

Telstra [TLS]
Last covered on August 5, 2003.
TLS formed an unstable V-bottom after a long stage 4 down-trend. Price rallied to test resistance at 5.00 but retreated after making a false (or marginal) break above that level. Twiggs Money Flow (100) has turned down sharply.


The break of the intermediate trendline signals weakness.
After a steady rise, Relative Strength (price ratio: xao) is re-testing support levels. A break below the previous low will be bearish; a new 3-month low will be an even stronger signal.



The marginal break above resistance, after [3], is followed to two equal lower highs at [4] and [5]; another bear signal. The retreat then encountered support at [6], coinciding with the high of [1], forming an over-square bar after a downward gap. Selling pressure overcame support and price appears headed for a test of support at the low of [2].



A fall below the low of [2] will signal a likely re-test of support at 4.00. If price consolidates between 4.60 and 5.00, that will be a long-term bull signal, favoring another breakout on the up-side.


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The weekly Trading Diary offers fundamental analysis of the
economy and technical analysis of major market indices,
gold, crude oil and forex.
The monthly What's New newsletter covers new articles
on Trading and the Economy, as well as new software updates.



Understanding the Trading Diary has been expanded to offer further assistance to readers, including directions on how to search the archives.

Colin Twiggs


If you're brave in being daring, you'll be killed;
If you're brave in not being daring, you'll live;
With these two things, in one case there's profit,
in the other there's harm.
The things Heaven hates - who knows why?
The Way is not to fight yet to be good at winning -
Not to speak yet skillfully respond -
No one summons it, yet it comes on its own -
To be at ease yet carefully plan.

~ Lao Tse.




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